Letter Re: Advice on Silver Coins for Barter

Mr. Rawles,
I have only a small amount of silver American coins but I constantly look for more. I find your advice to buy pre-1964 dimes, quarters and half-dollars difficult to realize as coin collectors are not selling junk silver in my area (Dallas/Fort Worth). To be frank the silver coins that are available are being sold at crazy prices (two or more times spot) over priced right now as everyone is freaking out about the economy. Reasonably priced coins, though significantly delayed, are available online and my collection has mainly been purchased this way.

On the other hand, silver dollars are frequently for sale at local coin stores. I purchase these when the market is favorable. They are especially easy to store in rolls. You never mention these coins though so I have some trepidation about making this the foundation of my bullion stash. Could you comment on this as well as 99% silver American Eagles as a survival monetary reserve? Thanks, – Neal

JWR: Replies: The premium is generally much higher for silver dollars (than dimes, quarters and halves), because even noticeably-worn dollars are in constant demand for the jewelry trade. (Belt buckles, etc.) A dollar coin also has a hair more silver content, than four quarters, but that is only significant for large quantities. (765 ounces versus 715 ounces, per $1,000 face value, if I recall correctly. That info is in my FAQ.)

Therefore, if your goal is accumulating a stock of coins for barter, then unless you can get silver dollars at nearly the same price as smaller silver, then buy only the smaller denomination silver coins.
One ounce silver American Eagles also command a higher premium than generic trade dollars. Although they are vaguely more recognizable than generics for barter purposes, I don’t think that they are worth paying the premium. The type of trade “dollars” that I look for are the commercially made (not from a the U.S. Mint) “US Assay Silver — .999 Fine — Trade Unit” one-ounce rounds. (To see an example, here is one that recently sold on eBay.) These are quite recognizable and hence will be trusted for barter–perhaps even more so than even American Eagles from the US Mint. Sadly, the average man on the street is ignorant about precious metals has probably never held an American Eagle coin in his hand. If you can find some these rounds (with the current scarcity), they sell for about 20% less that American Eagles or Canadian Maple Leafs. But of course in today’s incredibly scant market, beggars can’t be choosers.